Money remitted abroad for education taxed

Story image for todays news on education from The Express Tribune

 

The government was already charging 5 percent tax on fee exceeding Rs200,000 for those who are studying in local educational institutions.

 

“In order to remove anomaly and for the purpose of broadening the tax base, the FBR has now proposed 5 percent advance tax on amounts remitted abroad for education purposes,” said the official.

 

The FBR, according to the sources, obtained figures and data from the State Bank of Pakistan regarding those who were sending money abroad for educating their children.

 

“We found that substantial amount was being remitted abroad on this head so we decided to bring them into the tax net,” said the official.

 

The Finance Bill 2015-16 also proposed powers for the tax machinery to sign bilateral or multilateral agreements with other countries for exchange of information.

 

This proposed amendment will enable the tax authorities to exchange information from Dubai and Switzerland where influential have parked their dirty untaxed money.

 

“We have been seeking information from Dubai for the last several years but got no response because there is no agreement for exchange of information between the two countries,” FBR officials told The News here on Saturday.

 

However, the Finance Bill 2015 proposed charging advance tax at 5 percent on the amounts remitted abroad for educational purposes.

 

The Finance Bill 2015 states that the federal government may enter into bilateral or multilateral agreements with the provincial governments or with the governments of foreign countries for exchange of information, including electronic exchange of information, with respect to sales tax imposed under this Act or any other law of Pakistan and under the corresponding laws of such countries and may, by notification in the official Gazette, make such provisions as may be necessary for implementing such agreements.

 

To restrict disclosure of information by a public servant, the Finance Bill proposed that any information acquired under any provision of this Act or in pursuance of a bilateral or multilateral agreement or tax information exchange agreement shall be confidential and no public servant shall disclose any such information, except as provided under Section 216 of the Income Tax Ordinance, 2001 (XLIX of 2001).

 

In order to promote tax culture in the country, the board may prescribe prize schemes to encourage the general public to make purchases only from registered persons issuing tax invoices.

 

After Section 72C, a new section 72D shall be added, namely:–“72D. Reward to whistleblowers.– (1) The board may sanction reward to whistleblowers in cases of concealment or evasion of tax, tax fraud, corruption or misconduct providing credible information leading to such detection of tax fraud;

 

(2) The board may, by notification in the official Gazette, prescribe the procedure in this behalf and also specify the apportionment of reward sanctioned under this section for whistleblowers;

 

(3) The claim for reward by the whistleblower shall be rejected if– (a) the information provided is of no value; (b) the board already had the information; (c) the information was available in public records; or (d) no collection of taxes is made from the information provided from which the Board can pay the reward;

 

(4) For the purpose of this section, “whistleblower” means a person who reports concealment or evasion of sales tax and tax fraud leading to detection or collection of taxes, fraud, corruption or misconduct, to the competent authority having power to take action against the person or a sales tax authority committing fraud, corruption, misconduct, or involved in concealment or evasion of taxes”.

 

 

[“source-thenews.com.pk”]

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